BMP calls for oil tax cut to boost trade

Author: Agencies

The Federation of Pakistan Chambers of Commerce & Industry’s Businessmen Panel has sought reduction in tax ratio on petroleum products to facilitate the trade and industry, as the government has been charging petroleum levy and several other taxes on oil products to the record high level.

FPCCI former president and BMP Chairman Mian Anjum Nisar said that government is unable to pass on full benefit of oil prices drop in the global market to the local consumers because of high taxation, as maximum petroleum levy on petroleum products has now reached Rs80 per liter which is not justified.

Mian Anjum Nisar observed that the government has already increased the general sales tax on all petroleum products to a standard rate across the board to generate additional revenues.

He said that the Brent crude rates, during last six months period dropped to the lowest level, but the authorities, instead of providing full relief of massive fall in oil rates to the public further escalated the prices of petroleum levy on petrol by another 26% to the highest level along with the GST. Besides the sales tax, the government lifted the rate of petroleum levy on HSD and petrol by around 400%, during last almost one and half years. He called for passing on the full relief of cut in petroleum products in the international market to the local consumers for the month of Sept, instead of taking any kind of adjustment in taxes, as the inflation is going up due to continuous jump in oil prices.

He observed that business-friendly policies should be adopted as other neighboring countries of the region are giving to trade and industry. He said that sizeable cut in oil rates would certainly bring down the cost of doing business and our products would get their due share in the global market. He said that this target represents a significant increase of Rs 321 billion from the revised estimate of Rs 960 billion for the current fiscal year 2024-25.

He said that at a time when country’s GDP ratio was further stretched owing to slow exports growth amidst high cost of doing business, the trade and industry need maximum relief.

He said that Pakistan’s economy is going through a challenging phase. With a view to improve the cash flow of businesses at this crucial time, the government will have to facilitate the business community through reduction in tax ratio on all items including the oil products, besides deferring the interest payments of the businesses for at least one year.